Procter & Gamble (P&G), a major American consumer goods company, is pulling out of Nigeria and transitioning to an import-only model.
The shift will significantly impact the Nigerian economy, consumers and P&G itself.
The multinational company announced this major change in its operations during a 39-minute webcast on their website on Wednesday.
The maker of iconic brands, including Pampers, Gillette, Ariel, Always and Oral-B, said they could incur charges anywhere between $1 billion and $1.5 billion after-tax from restructuring its operations in Nigeria and Argentina, two markets where the business has been problematic for them.
Andre Schulten, P&G’s Chief Financial Officer, explained at the Morgan Stanley Global Consumer & Retail Conference in New York that the company’s decision to exit Nigeria was driven by the difficulty of operating as a dollar-based organization in the country’s challenging macroeconomic environment.
Despite being a $50m net sales business in Nigeria, P&G, with an $85bn overall portfolio, said that it expected minimal impact on the group’s balance sheet in terms of sales or profitability.’